Report: Improved Tax Policies Would Help Fix NM's Racial Inequity
Click to download
ALBUQUERQUE, N.M. -- New Mexico could use the inequities revealed by the coronavirus pandemic to overhaul tax policy and create a more fair-minded future for its residents, according to a new report.
Paige Knight, research and policy analyst at New Mexico Voices for Children, said people may not associate systemic racism with tax policies, but they often benefit some groups while disadvantaging others.
She noted the state's highest-income earners and large corporations received tax cuts based on the trickle-down economics school of thought that never resulted in promised jobs or other benefits for the majority of residents.
"Ultimately, these rather ineffective and unnecessary tax cuts to the wealthy and well-connected in New Mexico; they've really starved our schools and our health-care system of important funding," Knight argued.
The New Mexico Voices for Children 2020 report recommends lawmakers create an equitable budget and tax code to ensure the wealthy pay their fair share in taxes. It also encourages the state to enact targeted policies and tax cuts for families struggling financially.
Knight noted schools, hospitals and infrastructure benefit all New Mexicans, but not everyone is asked to share equal responsibility to support such facilities and improvements.
"New Mexicans who earn low and moderate incomes, who are primarily families of color, they pay a much greater share of their income in state and local taxes than do the state's highest-income earners who are disproportionately white," Knight observed.
Knight added legislation passed in 2019 raised the tax rate for those in the top 3% of earners and improved the overall equity of the tax code, but more remains to be done.
She contended if targeted tax credits and rebates were provided for families struggling financially, families could more quickly achieve financial security.
